Global Stratification

Global Stratification and Inequality

Stratification results in inequality when resources, opportunities, and privileges are distributed based on position in social hierarchy.

Learning Objectives

Discuss the three dominant theories of global inequality

Key Takeaways

Key Points

  • Society is stratified into social classes based on an individual’s socioeconomic status, gender, and race.
  • Stratification and inequality can be analyzed as micro-, meso-, and macro-level phenomena, as they are produced in small group interactions, through organizations and institutions, and through global economic structures.
  • Sociologists use three primary theories to analyze macro-level stratification and inequality: development and modernization theory, dependency theory, and world systems theory.

Key Terms

  • Macro-Level Stratification: The role of international economic systems in shaping individuals’ resources and opportunities by privileging certain social stratas.
  • Global Stratification: The hierarchical arrangement of individuals and groups in societies around the world.
  • Modernization Theory: Argues that poor nations remain poor because they hold onto traditional attitudes, beliefs, technologies, and institutions.

Global stratification refers to the hierarchical arrangement of individuals and groups in societies around the world.

Global inequality refers to the unequal distribution of resources among individuals and groups based on their position in the social hierarchy. Classic sociologist Max Weber analyzed three dimensions of stratification: class, status, and party. Modern sociologists, however, generally speak of stratification in terms of socioeconomic status (SES). A person’s SES is usually determined by their income, occupational prestige, wealth, and educational attainment, though other variables are sometimes considered.

Stratification and Inequality

Stratification refers to the range of social classes that result from variations in socioeconomic status. Significantly, because SES measures a range of variables, it does not merely measure economic inequality. For example, despite earning equal salaries, two persons may have differences in power, property, and prestige. These three indicators can indicate someone’s social position; however, they are not always consistent.

Inequality occurs when a person’s position in the social hierarchy is tied to different access to resources, and it largely depends on differences in wealth. For example, a wealthy person may receive higher quality medical care than a poor person, have greater access to nutritional foods, and be able to attend higher caliber schools. Material resources are not distributed equally to people of all economic statuses.

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US Wealth Held by Top 1% of Population (1913-2008): This graph illustrates the percentage of all US wealth held by the top 1% of the population. This percentage has shifted over time, but has consistently been a significant portion of total US wealth, indicating that wealth is not equally distributed between all US citizens.

While stratification is most commonly associated with socioeconomic status, society is also stratified by statuses such as race and gender. Together with SES, these shape the unequal distribution of resources, opportunities, and privileges among individuals. For example, within a given social class, women are less likely to receive job promotions than men. Similarly, within American cities with heavily racially-segregated neighborhoods, racial minorities are less likely to have access to high quality schools than white people.

Perspectives Towards Stratification

Stratification is generally analyzed from three different perspectives: micro, meso, and macro. Micro-level analysis focuses on how prestige and personal influence create inequality through face-to-face and small group interactions. Meso-level analysis focuses on how connections to organizations and institutions produce inequality. Macro-level analysis considers the role of economic systems in shaping individuals’ resources and opportunities.

Macro-level analyses of stratification can include global analyses of how positions in the international economic system shape access to resources and opportunities. For example, the small African nation of Cape Verde is significantly indebted to European nations and the U.S., and the majority of its industry is controlled by foreign investors. As the nation’s economy has ceded control of once-public services, such as electricity, its citizens have lost jobs and the price of electricity has increased. Thus, the nation’s position in the world economy has resulted in poverty for many of its citizens.

A global structure, or a macro-level phenomenon, produces unequal distribution of resources for people living in various nations.

Theories of Macro-Level Inequality

There are three dominant theories that sociologists use to consider why inequality exists on a global scale.

Global Social Stratification: People in countries around the world experience different access to resources and opportunities and different standards of living, based on their position in the global hierarchy.

Firstly, some sociologists use a theory of development and modernization to argue that poor nations remain poor because they hold onto traditional attitudes and beliefs, technologies and institutions, such as traditional economic systems and forms of government. Modernists believe large economic growth is the key to reducing poverty in poor countries.

Secondly, dependency theory blames colonialism and neocolonialism (continuing economic dependence on former colonial countries) for global poverty. Countries have developed at an uneven rate because wealthy countries have exploited poor countries in the past and today through foreign debt and transnational corporations (TNCs). According to dependency theory, wealthy countries would not be as rich as they are today if they did not have these materials, and the key to reversing inequality is to relieve former colonies of their debts so that they can benefit from their own industry and resources.

Lastly, world systems theory suggests that all countries are divided into a three-tier hierarchy based on their relationship to the global economy, and that a country’s position in this hierarchy determines its own economic development.

According to world systems theory as articulated by sociologist Immanuel Wallerstein, core countries are at the top of the global hierarchy as they can extract material resources and labor from less developed countries. These core countries own most of the world’s capital and technology, and have great control over world trade and economic agreements. Semiperipheral countries generally provide labor and materials to core countries, which benefits core countries but also increases income within the semiperipheral country. Peripheral countries are generally indebted to wealthy nations, and their land and populations are often exploited for the gain of other countries.

Because of this hierarchy, individuals living in core countries generally have higher standards of living than those in semiperipheral or peripheral countries.

Industrialized Countries

Industrialized countries have greater levels of wealth and economic development than less-industrialized countries.

Learning Objectives

Describe the characteristics of industrialized countries

Key Takeaways

Key Points

  • Industrialized countries are at the top of the global socioeconomic hierarchy, and their populations generally enjoy a high standard of living.
  • Most commonly, the criteria used to evaluate a country’s level of development is its gross domestic product (GDP) per capita.
  • One measure of a nation’s level of development is the Human Development Index (HDI), a statistical measure developed by the United Nations that gauges a country’s level of human development.

Key Terms

  • Developed Country: A sovereign state with a highly developed economy relative to other nations.
  • Industrialized Country: A sovereign state with a highly developed economy relative to other nations.
  • Human Development Index (HDI): A composite statistic used to rank countries by level of “human development,” taken as a synonym of the older term “standard of living. “
  • gross domestic product: (GDP) The market value of all officially recognized final goods and services produced within a country in a year, or over a given period of time; often used as an indicator of a country’s material standard of living.

An industrialized country, also commonly referred to as a developed country, is a sovereign state with a highly developed economy relative to other nations. Most commonly, the criteria used to evaluate a country’s level of development is its gross domestic product (GDP) per capita. However, many other variables are frequently taken into account. Factors used to measure a country’s development can include: per capita income, level of industrialization, extent of infrastructure, life expectancy, literacy rate, and general standard of living. The criteria to use and the countries to classify as developed are contentious issues, as discussed below.

Characteristics of Industrialized Countries

In terms of global stratification, industrialized countries are at the top of the global hierarchy. Developed countries, which include such nations as the United States, France, and Japan, have higher GDPs, per-capita incomes, levels of industrialization, breadth of infrastructure, and general standards of living than less developed nations. Consequently, people living in developed countries have greater access to such resources as food, education, roads, and electricity than their counterparts in less developed nations.

Human Development Index

One measure of a nation’s level of development is the Human Development Index (HDI), a statistical measure developed by the United Nations that gauges a country’s level of development. Often, national income or gross domestic product (GDP) are used alone to measure how prosperous a nation’s economy is. HDI considers these factors, but also accounts for how income is invested in healthcare, education, and other infrastructure. Thus, HDI is often used to predict trends in a nation’s development.

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United Nations Human Development Index (HDI) Rankings for 2011: Human Development Index (HDI) is a measure of how much of a nation’s wealth is invested into local services such as education and infrastructure. Countries with low HDI tend to be caught in a national cycle of poverty — they have little wealth to invest, but the lack of investment perpetuates their poverty. This map shows how disparate HDIs are around the world. Because nations have varying levels of wealth, income, and investment in infrastructure, individual populations experience inequality.

Criticisms

The Human Development Index, along with the entire concept of “developing” and “developed” countries, has been criticized on a number of grounds. The term “developing” implies inferiority compared to a developed country, and it also assumes a desire to develop along the traditional Western model of economic development. Critics argue that this is a rather Western-centric perspective. Critics also argue that it does take into account any ecological considerations and focuses almost exclusively on national performance and ranking.

Industrializing Countries

Industrializing countries have low standards of living, undeveloped industry, and low Human Development Indices (HDIs).

Learning Objectives

Explain why some scholars use the term ‘less-developed country’ instead of ‘industrializing country’

Key Takeaways

Key Points

  • In the global hierarchy, industrializing countries are at the middle of the global economic order as measured by indicators such as income per capita, basic infrastructure, literacy rates, or HDI.
  • HDI is the measure of development that is used by the United Nations. HDI considers a country’s per capita gross domestic product (GDP), per capita income, rate of literacy, life expectancy, basic infrastructure, and other factors to determine how developed a country is.
  • Because so-called “industrializing countries” do not always have economic growth, some scholars prefer the descriptive term “less- developed country ” to describe nations with smaller economies than developed countries.

Key Terms

  • Human Development Index (HDI): A composite statistic used to rank countries by level of “human development,” taken as a synonym of the older term “standard of living. “
  • Developing Country: A nation with a low living standard, undeveloped industrial base, and low Human Development Index (HDI) relative to other countries.
  • Industrializing Country: A nation with a low living standard, undeveloped industrial base, and low Human Development Index (HDI) relative to other countries.

An industrializing country, also commonly referred to as a developing country or a less-developed country, is a nation with a low standard of living, undeveloped industrial base, and low Human Development Index (HDI) relative to other countries. HDI is the measure of development that is used by the United Nations. HDI considers a country’s per capita gross domestic product (GDP), per capita income, rate of literacy, life expectancy, basic infrastructure, and other factors affecting standard of living to determine how developed a country is. Industrializing countries have HDIs between the most and least industrialized countries in the world.

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Map of GDP Per Capita (2008): The GDP of economies across the globe.

Considering global stratification, industrializing nations are at the middle of the hierarchy. Standards of living in industrializing nations are lower than in developed countries, but range widely depending on whether a nation is rapidly industrializing or is in decline. For example, India is considered a industrializing country. Many Indians, particularly in rural areas and urban slums, live in extreme poverty and have little access to healthcare, education, and paid employment. However, standards of living in India have greatly improved in recent decades as a result of a rapidly expanding economy. By contrast, in Afghanistan, which is also considered an industrializing nation, war and drought has halted economic growth and standards of living have not been rising substantially.

“Industrializing” versus “Less-developed”

Many scholars and social theorists have criticized the term “industrializing country” for being misleading. First, it implies that a country’s economy is growing; some partially industrialized countries are stagnant or in decline. Second, critics claim the term masks the inequality within each country. In other words, saying that India is an industrializing country hides the fact that within India some people are very wealthy and have a high standard of living, while some Indians are very poor and have few resources and opportunities. Because of such critiques, some scholars use the term less-developed country to describe the present circumstances in countries with relatively small economies and little infrastructure.

Developing Countries Need Infrastructure to Facilitate Trade: According to research from the World Bank, one challenge facing industrializing nations is how to successfully export products when they do not have pre-existing infrastructures to facilitiate international trade.

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Developed and Developing Countries: This map shows what stage of economic development various countries are in. It also includes which nations are in a transitional moment between stages of development.

Least Industrialized Countries

The world’s least industrialized countries have low income, few human resources, and are economically vulnerable.

Learning Objectives

Describe the characteristics of Least Developed Countries

Key Takeaways

Key Points

  • Least industrialized countries are more likely than more developed countries to have authoritarian governments, uncontrolled epidemics, and low access to services such as healthcare and education.
  • According to the UN, and least industrialized countries meet three standards:1. Low income (a three-year average gross national income of less that $905 USD per capita) 2. Human resource weakness3. Economic vulnerability.
  • Modern sociologists consider the world’s least industrialized countries to play a peripheral role in the world economy, and therefore refer to them as peripheral nations.

Key Terms

  • Least Industrialized Countries: The countries at the bottom of a stratified global economic order, which play only a peripheral role in the international economy.
  • Third World Countries: Those countries not aligned with the west or the east during the Cold War, especially the developing countries of Asia, Africa and Latin America.
  • Human Development Index (HDI): A composite statistic used to rank countries by level of “human development,” taken as a synonym of the older term “standard of living. “

In contrast to industrialized and industrializing countries, the world’s least industrialized countries exhibit extremely poor economic growth and have the lowest Human Development Index (HDI) measures in the world. HDI is the measure of development that is used by the United Nations. HDI considers a country’s per capita gross domestic product (GDP), per capita income, rate of literacy, life expectancy, basic infrastructure, and other factors affecting standard of living to determine how developed a country is. To be considered a least industrialized country, or least developed country (LDC) as they are commonly called, a country must have a small economy and low standards of living.

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Map of GDP Per Capita (2008): This map shows countries’ gross domestic products (GDP) per capita. Countries in the 1–10,000 international dollar range roughly correspond to least industrialized countries.

Defining an LDC

By the United Nations’ standards, a country must meet three specific criteria to be classified as an LDC:

  1. Low income (a three-year average gross national income of less that $905 USD per capita)
  2. Human resource weakness, based on indicators of nutrition, health, education, and literacy
  3. Economic vulnerability, based on instability of agricultural production, instability of exports of goods and services, and a high percentage of population displaced by natural disaster, for example.

The UN uses such specific standards for defining LDCs because the UN provides support and advocacy services to LDCs. Thus, the definition of LDCs is more rigid than the definition of developing/industrializing and developed/industrialized countries.

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Map of Least Developed Countries: Least developed countries tend to be concentrated in areas with ongoing conflict, a high rate of natural distasters, or industries that are vulnerable to climate instability.

Characteristics

Not all LDCs are alike, but many characteristics are shared. For example, the majority of LDCs are located in Sub-Saharan Africa. LDCs in this region are particularly likely to have authoritarian governments such as dictatorships. Similarly, for many LDCs AIDS is a major issue, overwhelming unstable medical infrastructures. In all LDCs, populations have a low standard of living. People living in LDCs are unlikely to have consistent access to electricity, clean water, healthcare, education, and in many cases food and shelter.

The “Third World”

In the past, countries that are now labeled as LDCs were known as “third world” countries. Third world countries were undeveloped countries that were neither major players in the capitalist world market nor communist states under the USSR. Most current scholars consider the term “third world” to be outdated. Modern sociologists are more likely to describe the world’s least industrialized nations as “peripheral,” referring to their marginalized position in the world economy. Least industrialized nations are likely to be exploited by more developed nations for material and human resources, such as oil and cheap labor. They participate in the world economy, but do not greatly benefit from it. Least industrialized nations are at the bottom of a stratified global economic order, and play only a peripheral role in the international economy.

Global Humanitarian Forum Discussion of Special Needs of Least Industrialized Countries: Here policy makers discuss the challenges that countries with small, insecure economies and inadequate infrastructure face as they seek higher status in the global hierarchy.

Growing Global Inequality

There is a wide gap between the wealth of the world’s richest countries and its poorest.

Learning Objectives

Describe the development of global inequality in the 20th century

Key Takeaways

Key Points

  • Global inequality is thought to have peaked around the year 1970, but inequality remains significant and persistent.
  • According to social reproduction theory, rich and powerful individuals benefit from being at the top of the economic hierarchy and have the influence needed to protect their status, so they contribute to the persistence of global inequality.
  • Even though global inequality has decreased in recent decades, inequality is persistent and shows no signs of disappearing.

Key Terms

  • Social Reproduction Theory: According to this theory of inequality, rich and powerful individuals and institutions perpetuate inequality to protect their high status.
  • Twin Peaks: Opposite clusters of the world’s richest and poorest countries.
  • divergence: The degree to which two or more things separate or move in opposite directions.

There is a vast gap between the wealth of the world’s richest countries and its poorest, resulting in different access to resources and opportunities for each country’s population. To discuss this global inequality, sociologists may refer to the world’s ” twin peaks,” or two groups of its richest and poorest countries. At the top of the hierarchy, a group of countries that includes the United States, Japan, Germany, the United Kingdom, France, and Australia has 13% of the world’s population but receives 45% of its income (adjusted for international purchasing power). At the bottom of the hierarchy, a group of countries including India, Indonesia, and China has 42% of the world’s population but receives only 9% of income (adjusted for international purchasing power). The existence of these twin peaks demonstrates that there is a wide gap between the world’s wealthiest and poorest nations.

Throughout most of the 20th century, there was a trend towards divergence between the economies of richer and poorer countries. In other words, the gap between wealthy, developed nations and poorer, developing nations widened — global inequality increased. Current research indicates, however, that global inequality peaked around 1970. Around the year 1970, world income was distributed between extremely rich and extremely poor countries, with little overlap. Since the 1970s, trends show that an increasing percentage of the world’s population lives in middle-income countries. Thus, there is a broader spectrum of incomes, with fewer people living at the extremes of wealth and poverty than in the past. Since 1970, global inequality has decreased.

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Global inequality: As of 2009, there was still a stark divide between the wealth of the world’s richest countries and its poorest, but an increased number of countries had middle-incomes as compared to the years prior to 1970. Global inequality remained persistent but had decreased somewhat.

Even though global inequality has decreased in recent decades, inequality is persistent and shows no signs of disappearing. Evidence used by researchers to demonstrate the presence of global inequality includes: the poorest 10% of Americans have a higher standard of living than 2/3 of the world’s population; the richest 1% of the world’s population holds as much wealth as the poorest 10% of the population; and the three richest individuals in the world possess greater wealth than the poorest 10% of the population. These statistics are small glimpses of the big picture of global economy, but begin to illustrate the great inequality that exists.

Sociologists who study global inequality have proposed social reproduction theory as one way to explain the persistence of inequality. According to social reproduction theory, rich and powerful individuals and institutions perpetuate inequality to protect their high status. The rich and powerful control the means of production (such as factories, land, and transportation) and often have strong influence in government. Moreover, they often control the media, schools, and courts, extending their influence in various social realms. Because individuals and institutions at the top of the economic hierarchy benefit from their status, they use their influence to protect their positions.

A related explanation for the persistence of inequality is the idea that culture teaches acceptance of the extant economic hierarchy. According to this view, individuals are taught to believe that the rich and powerful are more talented, hardworking, and intelligent than the poor. This explanation holds that the misconception that poor people are lazy or irresponsible is widespread, and that people are therefore likely to accept that poor people deserve to be poor. People who ascribe to the cultural belief that the rich are deserving of their wealth are unlikely to challenge economic inequality, so they thereby perpetuate it.